LIMITATION OF RENT INCREASE FOR RESIDENTIAL RENTING ANNOUNCED BY THE MINISTER OF JUSTICE
We refer to our Newsletter dated 6 June 2022 whereby we informed you that a temporary regulation regarding the rent increase has been envisaged and the details of such an arrangement would be announced soon.
The Minister of Justice has announced that a temporary provision will be added to the Code of Obligations numbered 6098 (in Turkish, “Türk Borçlar Kanunu”, “TCO”) and it will stipulate that for the residential lease contracts, the rent increase rates shall not exceed 25% of the previous rental year’s rent amount.
It should be noted that this is a temporary arrangement envisaged to be valid and in effect until 1 July 2023 as from the date of entry into force of the said temporary provision. The implementation date of such regulation is expected to be published.
Additionally, this limitation shall not apply in cases of re-evaluation of rent upon elapse of a period of five (5) years or renewal period of five (5) years in accordance with Article 344/3 of the TCO.
It should be noted that the current annual increase rate in June 2022 is 39.33%.
Just to recap, according to this announcement; (i) the limitation of rent increase of 25% for the residential lease contracts is emphasized to be a temporary arrangement until 1 July 2023, (ii) the implementation date of this regulation is expected to be published in the Official Gazette.
Our Law Firm remains at your disposal for any further clarifications you may need.